Compensation must reflect 50% future prospects and multiplier 15 for a 36-year-old permanent employee.

Late Ramgopal Jaiswal died in a road accident involving two scooties on 12 August 2021. He was employed as a Trammer with S.E.C.L. and left behind his wife and three children.

The Claims Tribunal, in Claim Case No. 67/2021, awarded the claimants compensation of ₹1,64,02,000 by its award dated 17 November 2022 and fastened liability on National Insurance Company Ltd.

The claimants filed MAC No. 117/2023 seeking enhancement, principally challenging the assessment of future prospects and the amounts granted under conventional heads. The Insurance Company filed MAC No. 137/2023, challenging the deceased’s monthly income, the multiplier of 16, and the finding rejecting contributory negligence.

1. Whether the deceased’s monthly income was correctly assessed by the Claims Tribunal, or whether the three-month bonus included in the salary was required to be proportionately excluded?

2. Whether the claimants were entitled to 50% addition towards future prospects, considering the deceased’s age and permanent employment, instead of the 40% addition granted by the Tribunal?

3. Whether the appropriate multiplier was 16 or 15, having regard to the deceased’s actual age on the date of the accident?

4. Whether the deceased was guilty of contributory negligence in the head-on collision, thereby reducing or displacing the insurer’s liability?

5. Whether the compensation awarded under the conventional heads required enhancement?

The appeals were maintainable under Section 173 of the Motor Vehicles Act, 1988, which permits an appeal against an award of the Claims Tribunal.

For computation of compensation, the Court applied National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, holding that a deceased in permanent employment and within the applicable age bracket is entitled to a 50% addition towards future prospects and to appropriate amounts under conventional heads.

It relied on Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, for the deduction of one-fourth towards personal expenses where the deceased leaves four dependants and for selection of the multiplier according to age.

It further applied Magma General Insurance Co. Ltd. v. Nanu Ram, (2018) 18 SCC 130, in awarding consortium to the eligible claimants.

Contributory negligence had to be established through credible evidence; a mere assertion by an interested party, unsupported by pleadings or reliable evidence, was insufficient.

The Court accepted the Insurance Company’s objection that the salary figure included a three-month bonus of ₹11,247. Since only one month’s bonus could properly form part of monthly income, ₹7,498 was deducted, resulting in a monthly income of ₹86,298 and an annual income of ₹10,35,576.

As the deceased was 36 years old and permanently employed, Pranay Sethi required a 50% addition for future prospects, producing an annual income of ₹15,53,364. After income-tax deduction of ₹2,78,509, the annual income was fixed at ₹12,74,855.

Applying the one-fourth deduction for personal expenses, the multiplicand became ₹9,56,141.25, and applying the multiplier of 15 yielded ₹1,43,42,118.75 for loss of dependency.

The Court rejected contributory negligence because the owner had not pleaded that he was travelling as a pillion rider, making his account of the accident unreliable. In contrast, eyewitness Jai Kumar supported the claimants, was cited in the charge-sheet, and his testimony established rash and negligent driving by Ajesh Kujur.

The conventional-head award was enhanced from ₹70,000 to ₹2,09,000, comprising ₹16,500 each towards loss of estate and funeral expenses and ₹44,000 consortium for each of the four claimants.

The compensation was reduced from ₹1,64,02,000 to ₹1,45,51,119, rounded off from ₹1,45,51,118.75.

The Court held that the deceased’s monthly income was ₹86,298, future prospects were to be calculated at 50%, the applicable multiplier was 15, and no contributory negligence was proved against the deceased.

The Insurance Company remained liable to satisfy the modified award, while the remaining conditions of the Tribunal’s award were left undisturbed.

The Registry was directed to communicate the modified amount to the claimants in Hindi, with assistance from paralegal workers if necessary.